Pattaya sees rise in independent Chinese tourists amid decline in group tours

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Thai economy posts 9.1 percent second-quarter growth: govt

BANGKOK (AFP) -- The Thai economy grew 9.1 percent year-on-year in the second quarter of 2010 as strong exports cushioned the blow from violent street protests that hit the key tourism sector, data showed Monday.

The strong performance was seen as raising the odds of Thailand's central bank increasing interest rates again when it meets later this week, following its first hike in almost two years in July.

Gross domestic product (GDP) expanded for a third straight quarter compared with a year earlier, but at a slower pace than the breakneck growth of 12.0 percent seen in January-March, a government agency said.

On a seasonally adjusted basis, GDP expanded 0.2 percent in April-June from the previous quarter, after a 3.3 percent rise in January-March, according to the National Economic and Social Development Board.

The Thai economy has remained relatively resilient following two months of mass opposition protests, which paralysed parts of Bangkok and sparked violence that left 91 people dead, ending in a bloody army crackdown in May.

The better-than-expected second-quarter result was largely thanks to robust overseas demand for Thai-made goods, such as cars.

The country is striving to become a regional hub for automobile production, with foreign makers such as Toyota operating factories in the kingdom.

Exports soared 41.8 percent in the second quarter of 2010 in dollar terms, on the back of a global economic recovery, the figures showed.

Household spending expanded by a robust 6.5 percent as consumers splurged on cars and electrical goods.

But growth in the hotel and restaurant industry slowed to just 0.2 percent as the political unrest scared off foreign tourists.

Speculation is now growing that the Bank of Thailand may lift official borrowing costs for a second straight month when policymakers meet on Wednesday.

In July the central bank raised interest rates for the first time since 2008 -- by 25 basis points to 1.5 percent -- saying that the economic impact of the "Red Shirt" anti-government protests had been relatively limited.

-- (c) Copyright AFP 2010-08-23

[Abrak]

One thing people should be aware of in those numbers is the QOQ figure which was 0.2% equating to a QOQ SAAR of about 0.8%. In other words there is very strong YOY growth but not much QOQ.

Given the protests it isnt surprising but I think one should assume that the best of the recovery is behind us.